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World Quality Report shows IT spending on QA falling, TCoEs in decline

26 September 2017

Capgemini's 2017 World Quality Report illustrates how the move to Agile and DevOps is making the Test Centre of Excellence less relevant, while the lower spend on quality assurance is a positive trend, according to one of the report’s authors, Mark Buenen (pictured left)

After years of steady growth, the proportion of IT budgets spent on quality assurance has fallen from 31% to 26% over the past year, according to the annual survey of QA trends produced by consultancy Capgemini. Spending on IT hardware has meanwhile risen.

The other key finding of the survey, which compiled responses from 1,660 CIOs in 32 countries, is that the rise of Agile working methods has led to a decline in importance of the Test Centre of Excellence (TCoE), the quality assurance “factory” model that gained popularity over recent years, partly as a product of firms’ outsourcing partnerships with the major systems integrators.
The TCOE’s – often located off-shore and often dependent on a large number of manual testers – were promoted as the right way to lower costs and accelerate app delivery while maintaining software quality. But the shift left in software development has led to the creation of more de-centralised teams, the report said.

According to the report: “TCoEs are moving towards playing supporting role to help increase test activities in devolved scrum teams.” But for many financial firms, TCoEs will continue to play an important role, because they cannot move as quickly as they would like to Agile and DevOps methodologies. “Legacy technology, their core banking applications, organizational inertia, and compliance with regulation can slow the pace of change,” it said.

However: “The TCoE model isn’t failing,” said Mark Buenen, global head, digital assurance and testing at Sogeti, and one of the report’s authors. “Old-fashioned TCoEs work well for core IT systems. But as firms move more and more to Agile, the test factory model will not work.” So banks, in particular among firms that responded to the survey, are trying to get to grips with a two-tiered approach to quality assurance, combining the TCoE model with decentralised teams.

The apparent drop in spending on quality assurance, at least in percentage terms, is a good sign, said Buenen. “The proportion was 18% five years ago and it had risen close to 35% a year ago. If an organisation is spending that proportion of its IT budget on quality assurance then it’s a sure sign that its approach to quality is out of control.” The correct, sustainable, proportion of spending on QA is around 25%, he said.

“Agile means you can’t offshore to the same extent, and companies are looking for ways in which to be smarter; reducing the number of tests they run, for example.” The proportion of IT budget spent on quality assurance by banks and other financial firms is broadly in line with the findings of the survey, said Buenen.

Looking ahead, the key trends in quality assurance will be driven by firms’ desire to automate more testing and to adopt technologies such as test virtualisation, the World Quality report concluded. The level of test automation among respondents to the survey remains below 20%, while few have the infrastructure that would allow them to adopt virtualisation.
More than 50% of respondents to the survey cited the management of data environments and compliance with new data regulations as a top challenge.

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